Coronavirus: Realtors suggest homeowners evaluate all options when considering mortgage relief

Different programs may be available for homeowners in need of help, depending on the bank or lender.
As more homeowners seek mortgage relief provided by the government and banks, realtors are urging people to evaluate all options before making a decision.

"You've gotta call your bank and you've gotta ask them, 'hey I need help'. And you really don't want to do that unless you really need the help," said realtor Jose Nunez.

Nunez says there are different programs, depending on the bank or lender.

Most are offering forbearance or deferment and it's key to know the difference. They both let you skip payments for a certain time period. But with forbearance, when the time is up, all those missed payments are due in a balloon payment.

With deferment, those missed payments are simply tacked onto the back end of the loan.

"The best case scenario is where they tack it onto the back of your mortgage and everything continues as normal," said Nunez.

Nunez says forbearance could put you in a harder situation down the road, so you may have to negotiate.

"If it's a bad one, where they're telling you to pay a lump sum after month 3, month 6, whatever the case is, you can tell them 'hey, how is this going to help me?' Try to get them to give you a better offer," said Nunez.

If you're in this dilemma, you're not alone.

According to the Mortgage Bankers Association, forbearance requests grew by 1,270% between the week of March 2 and March 16. It grew another 1,896% the following week.

"If they don't have enough money to make the balloon payment, it's gonna come down to a decision. Do I sell my house at that point or do I lose it," said Nunez.

Nunez believes many will be forced to sell their homes, cashing out on equity or the better option taking advantage of low interest rates and refinancing.

"Some people may be able to refinance and lower their payment, skip a month and that might be a better option."

As far as day-to-day transactions, Nunez says that hasn't slowed down as they first thought it would.

Some are pulling back out of fear, but many who were once getting outbid, now have an opportunity to buy with less competition.
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